NOTICE TO MEMBERS. NOTICE is hereby given that the TWENTY SECOND ANNUAL GENERAL MEETING OF MAHALAXMI RUBTECH LIMITED will be th

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3 ORDINARY BUSINESS: SPECIAL BUSINESS: NOTICE TO MEMBERS NOTICE is hereby given that the TWENTY SECOND ANNUAL GENERAL MEETING OF MAHALAXMI RUBTECH LIMITED will be th held at Lions Hall, Nr. Nalanda Hotel, Mithakhali Six Road, Ellisbridge, Ahmedabad on the Saturday, September 28, 2013 at p.m. to transact the following business: 1. To receive consider and if approved, adopt the Audited Balance Sheet as at and Profit and Loss Account for the year ended on that date and the reports of the Directors and Auditors thereon. 2. To appoint Auditors of the company from the conclusion of this meeting to the conclusion of the next Annual General Meeting. 3. To appoint a director in place of Shri Nehal M.Shah, who retire by rotation and being eligible offers himself for reappointment. 4. To consider and if thought fit, to pass with or without modifications(s), the following resolution as a Special Resolution: RESOLVED THAT pursuant to provision of section 198, 269, 309 and other applicable provisions of the Companies Act 1956, and Schedule XIII thereto, approval be and is hereby granted to the reappointment of Mr. Anand J. Parekh as Jt. Managing Director of the st Company for the period of five years with effect from 1 October, 2013 on the remuneration set out in the explanatory statement relating to this resolution, with liberty to the Board of Directors and the remuneration committee ( the committee ) to alter or vary the terms and conditions and remuneration including minimum remuneration in such manner as the Board may deem fit and acceptable to Mr. Anand J.Parekh RESOVED FURTHER THAT Shri Anand J. Parekh will be liable to retire by rotation during the tenure of his appointment as a Jt. Managing Director. FURTHER RESOLVED THAT where in any financial year During the tenure of Jt.Managing Director, the Company has no profits or its profits are inadequate, the remuneration payable to Mr. Anand J.Parekh shall be governed by schedule XIII of the Companies Act 1956 or any modification thereto. RESOVED FURTHER THAT in the event of any statutory amendment or modification to schedule XIII to the Companies Act 1956, the Board of Director and committee be and are hereby authorized to vary or increase or modified the remuneration including salary, commission,perquisites, allowance, etc. 5. To consider and if thought fit, to pass with or without modifications(s), the following resolution as a Special Resolution: RESOLVED THAT in pursuance of provisions of Section 314 and other applicable provisions if any of the Companies Act,1956 and rules made there under from time to time and subject to such other consents, approvals, permissions as may be required, consent of the Company be and is hereby accorded to Shri Rajendra R. Mehta to hold an office and place of profit in the Company, he being partner in Associate Concern and continue to hold office with increase in remuneration as mentioned below payable to Shri Rajendra R. Mehta to the position of Group President & CFO under such other designation as the Company may decide from time to time w.e.f Salary of 75000/- with such further increment as may be decided by the management however salary payable can not exceed per month without prior approval of Central Government under section 314 of Companies Act, 1956 read with amended Director's Relative (Office or Place of Profit Rules) 2011 with other modifications, amendments and variation as the Central Government may suggest at that time In addition to the Salary, Shri Rajendra R. Mehta will be entitled to Perquisites and Allowances as per the policy of the company, including: I. Leave Tavel Allowance II. Medical and Accident Insurance premium as per Company rules: III. Leaves in accordance with the leave rules of the Company from time to time IV. Entertainment, traveling and all other expenses incurred for the business of the Company shall be reimbursed as pr Rule of the Company. V. Any other allowances, benefits and perquistes admissible to the senior officer of the Company as per Rules of the Company. By order of the Board of Directors For Mahalaxmi Rubtech Limited Place: Ahmedabad Date: August 21, Japan N. Shah (Company Secretary)

4 NOTE A MEMBER ENTITLED TO ATTEND AND VOTE IS ENTITLED TO APPOINT A PROXY TO ATTEND AND VOTE INSTEAD OF HIMSELF/ HERSELF AND THE PROXY NEED NOT BE A MEMBER OF THE COMPANY AND INSTRUMENT APPOINTING PROXY SHOULD REACH THE REGISTERED OFFICE OF THE COMPANY AT LEAST 48 HOURS BEFORE THE COMMENCEMENT OF THE MEETING. THE REGISTER OF MEMBERS AND TRANSFER BOOK OF THE COMPANY WILL REMAIN CLOSED FROM SATURDAY THE st th 21 DAY OF SEPTEMBER, 2013 TO SATURDAY THE 28 DAY OF SEPTEMBER, 2013 (BOTH DAYS INCLUSIVE) Members holding shares in dematerialized mode are requested to intimate all changes pertaining to their bank details, Power of Attorney, change of address/name. etc to their Depository Participant only. Changes intimated to the Depository Participants will be automatically reflected on the Company's record which will help the Company and its Registrar and Transfer Agent to provide efficient and better services. Members seeking any information or clarification on the Accounts are requested to send in written queries to the Company, at least one week before the date of the Meeting, Replies will be provided in respect of such queries received in writing, only at the Meeting. A Member or his Proxy is required to bring a copy of the Annual Report to the Meeting as extra copies will not be distributed. Members/ Proxies should bring the Attendance Slip sent herewith duly filled in for attending the Meeting. th In compliance with the Security and Exchange Board of India (SEBI) circular dated 7 January,2010 it is mandatory for Members holding shares in Physical form to furnish a copy of PAN in the following cases: (i) (ii) Deletion of name of deceased shareholders(s), where the shares are held in the name of two or more shareholders. Transmission of shares to the legal heir(s), where the deceased shareholder was the sole holder of shares. (iii) Transposition of shares when there is a change in the order of names in which physical shares are held jointly in the name of two or more shareholders Keeping in view the Green Initiative in Corporate Governance of Ministry of Corporate Affairs the Company proposes to send notices/ documents including annual reports, etc. to the members in electronic form. Members who have still not registered their addresses are requested to register their e mail addresses, in respect of electronic holdings with the Depository through the concerned Depository Participants and in respect of physical holdings, with the Company's Registrar and Share Transfer Agents, th Sharepro Services (I) Pvt Ltd, , 4 Floor, Devanandan Mall, Opp. Sanyas Ashram, Ellisbridge, Ahmedabad Gujarat ; id: sharepro.ahmedabad@shareproservices.com Those members who have already registered their addresses are requested to keep their addresses validated with their Depository Participants to enable servicing of notices/ documents/ Annual Reports electronically to their addresses. Please note that as a valued Member of Company, you are always entitled to request and receive all the communication in physical form. Further, the documents served through are available on company's website www. mrtglobal.com and are also available for inspection at the registered office of the company during office hours. THE COMPANY IS HAVING DEPOSITORY ARRANGEMENT WITH NATIONAL SECURITIES DEPOSITORY LIMITED (NSDL), AND CENTRAL DEPOSITORY SERVICES (INDIA) LIMITED (CDSL) TO FACILITATE THE SHAREHOLDERS TO HOLD AND TRADE COMPANY'S EQUITY SHARES IN ELECTRONIC FORM. INTERESTED SHAREHOLDERS CAN AVAIL THIS FACILITY BY OPENING A BENEFICIARY ACCOUNT WITH DEPOSITORY PARTICIPANTS. FOR MORE DETAILS SHAREHOLDERS MAY CONTACT THE COMPANY'S DEPOSITORY TRANSFER AGENTS FOR NSDL AND CDSL, SHAREPRO SERVICES (INDIA) TH PVT. LTD., , 4 FLOOR, DEVNANDAN MALL, OPP. SANYASH ASHRAM, ELLISBRIDGE, AHMEDABAD By order of the Board of Directors For Mahalaxmi Rubtech Limited Place: Ahmedabad Date: August 21, Japan N. Shah (Company Secretary)

5 ANNEXURE TO NOTICE EXPLANATORY STATEMENT PURSUANT TO SECTION 173 (2) OF THE COMPANIES ACT,1956. Item no. 4 th The tenure of Mr. Anand J. Parekh expires on 19 November; 2013.In view of future level of business operations and increase th responsibilities, the Board of Directors at their meeting held on 12 August, 2013 has decided to re-appoint Mr. Anand J. Parekh for further period of 5 years from The Remuneration committee has also recommended his reappointment as a Jt, Managing Director of the Company and has approved remuneration payable to him. This may be treated as abstract under Section 302 of the Companies Act,1956 Briefly, the terms and condition of the re-appointment and remuneration of Mr. Anand J. Parekh are as follows including allowance and perquisites listed below. 1. Salary 2. PF Contribution 3. Gratuity 4. Leave Travel Allowance 5. Car & Telephone 6. Personal Accident Insurance 7. Entertainment and other business 8. Club Fees 9. Gas/ Water / Electricity 10. Medical Expenses 11. Other allowances, benefits and perquisites 1,00,000 (One Lac) per month Contribution to Provident Fund shall be as per the rules of the Company Gratuity payable shall not exceed half a month's basic salary for each completed year of service. For self and family, once a year in accordance with Rules of the Company The Company will provide car with driver. The Cell phone and telephone facility at residence shall not considered as perquisites.use of cell phone / telephone shall be reimbursed. For an amount, premium of which shall not exceed 20,000p.a./- Entertainment, traveling and all other expenses incurred for the business of the Company shall be Expenses reimbursed as pr Rule of the Company. Membership Fees and expense of Two Club in India. Actual Expenditure (Incurred) Reimbursement of medical expenses and medical policy for self and family Any other allowances, benefits and perquistes admissible to the senior officer of the Company as Perquisites per Rules of the Company. None of the Directors of the Company other than Shree Jeetmal B.Parekh and Shri Rahul J.Parekh are interested or concerned in the Resolution. Item No 5 The Board of Directors had appointed Mr.Rajendra R.Mehta as Group President & CFO of the company w.e.f at monthly salary of 40000/- in scale of 40000/- to 70000/- p.m. Since he has been actively involved in day to day affairs and having vast experience in the field of Finance, Accounting, Taxation. Considering his qualification, responsibility, position and remuneration as are applicable to other employee of the Company in the same grade it is now proposed to increase the remuneration payable to him more particularly described in the Special Resolution at Item No. 5 of the Notice. In terms of Section 314 of the Companies Act, 1956 members approval by way of special resolution required for the aforesaid remuneration. None of the Directors of the Company except Shri Jeetmal B. Parekh, Shri Rahul J. Parekh and Shri Anand J. Parekh are interested in the proposed resolution to the extent of their shareholding in the company. 3

6 DIRECTORS REPORT TO THE MEMBERS, Your Directors have pleasure in presenting herewith the Directors' Report, along with the Audited Balance Sheet and Profit & Loss st Account for the year ended 31 March, FINANCIAL RESULTS: Income from Operations & Other Income Profit before Depreciation Less: Depreciation Profit before Tax Less: Provision for Tax Less: Provision for deferred Tax Profit after Tax For the year ended ( in Lacs) For the year ended ( in Lacs) (26.32) OPERATION AND REVIEW: The Company continues to see marginal growth in the financial year driven by the average performance in existing and new business. The total income increased to lacs from lacs in the previous year, at a rate of %.The Profit before Tax amounted to lacs as against lacs in the previous year. The net profit after tax was lacs as against lacs in the previous year. DIVIDEND: Board of Directors has not recommended any dividend for the Financial Year DIRECTORS: Shri Nehal M.Shah, liable to retire by rotation at the ensuing Annual General Meeting and being eligible offers himself for reappointment. DIRECTORS RESPONSIBILITY STATEMENT: In accordance with the provisions of Section 217(2AA) of the Companies Act, 1956 as amended by Companies (Amendment) Act, 2000, your Directors state: (i) that in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures; (ii) that the directors have selected such accounting polices and applied them consistently and made judgments and estimates that are reasonable and prudent, so as to give a true and fair view of the state of affairs of the Company at the end of the financial year ended on and of the profit of the Company for the year ended on ; (iii) that the directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; (iv) that the directors have prepared annual accounts on a going concern basis. CORPORATE GOVERNANCE: Your company has complied with the requirements regarding Corporate Governance as required under Clause 49 of the Listing Agreement entered into with the Stock Exchange, where the Company's shares are listed over the year and it is a continuous and ongoing process. A Report on the Corporate Governance in this regard is made a part of this Annual Report and a Certificate from the Auditors of the Company regarding compliance with the conditions of Corporate Governance is enclosed to this report. 4

7 MANAGEMENT DISCUSSION AND ANALYSIS: The Management Discussion and Analysis Report as required under clause 49 of the Listing Agreement with the Stock Exchange has been attached and forms part of this Directors' Report. AUDIT: M/s. Bhanwar Jain & Co., Chartered Accountants, Ahmedabad,who are Statutory Auditors of the Company hold office up to the forthcoming Annual General Meeting and are recommended for re-appointment to audit the accounts of the Company for the Financial Year As required under the provisions of the Section 224(1B) of the Companies Act,1956,the Company has obtained written confirmation from M/s. Bhanwar Jain & Co that their appointment if made would be in conformity with the limits specified in the Section. As per the requirement of Central Government and pursuant to Section 233B of the Companies Act,1956, Cost Accounting record Rules your Company carries out an audit of cost records every year. The Company has appointed M/s A.G.Dalwadi & Co., Cost Accountants, as Cost Auditors to audit the cost accounts of the Company for the Financial Year , subject to the approval of the central government The cost audit report for the Financial year which was due to be filed with the Ministry of Corporate Affairs on September 30, 2012 and extended further upto was filed on FIXED DEPOSITS: The company has not accepted any deposits from public within the meaning of provisions of section 58A and 58AA of the Companies Act, 1956 and the rules framed there under and the directives issued by the Reserve Bank of India. RIGHTS ISSUE : th Company has filed Draft Letter of offer with Securities Exchange Board of India for issue of Right Shares on 14 November, The same was approved by SEBI on INSURANCE: All the assets of the company including the inventories, building, plant and machineries are adequately insured. COMPULSORY TRADING IN DEMAT: Trading of the equity shares of your Company are being traded compulsorily in DEMAT FORM from March 23, 2001 pursuant to circular of SEBI. EMPLOYEES: The information required under sub section (2A) of section 217 of the Companies Act, 1956 in respect of certain employees of the company are as under: (a) Employees employed throughout the year and who were in receipt of remuneration of not less than 60,00,000/- per annum in terms of section 217 (2A) (a) (i) None. (b) Employees employed for the part of the year and who were in receipt of remuneration of not less than 5,00,000/- per month in terms of section 217(2A) (a) (ii) None. (c) None of the employees is covered under section 217 (2A) (a) (iii). CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION: The information required under section 217 (1) (e) of the Companies Act, 1956 read with the companies (Disclosures of in the report of the board of Directors) Rules, 1988 is annexed hereto and forms part of this report. LISTING: The Securities of your company are listed with the Bombay Stock Exchange Limited, and pursuant to Clause 38 of the Listing Agreement, the Annual Listing fees for the year have been paid to them well before the due date. The Company has also paid the annual custodian fees to NSDL & CDSL for the Securities of the Company held in dematerialized mode with them for year APPRECIATION: Your Directors express their gratitude for the continued support and guidance received by the Company from the customers, vendors, investors, bankers and employees at all levels. Our consistent growth was made possible by their hard work, solidarity, cooperation and support. We look forward for their continued support in the future. For and behalf of the Board Mahalaxmi Rubtech Limited Place: Ahmedabad Date: May 30, 2013 Jeetmal B. Parekh (Chairman) 5

8 ANNEXURE TO DIRECTORS REPORT Information required under the Companies (Disclosure of particulars in the Report of the Board of Directors) Rules, (A) CONSERVATION OF ENERGY The company has adopted the system of shutting down the electrical machinery and appliances when not in use to avoid unnecessary waste of energy. New investments in machines are being considered with an idea to have reduction of consumption of energy. The impacts of such measures are not precisely ascertainable. The total energy consumption and consumption per unit of production required in form `A' is given here under: FORM `A (a) Power and Fuel Consumption 1. Electricity (a) Purchased: Units Amount Rs (b) Own Generation: (i) Through Diesel: Units Amount (ii) Through Windmill Units ,68,81, ,96,87, ,04,840 24, Fuel Waste Wood Tonnes Amount Coal & Lignite Tonnes Amount Steam Coal Tonnes Amount ,83,48, ,97,85, ,70,10, ,95,71,773 (b) Consumption per unit of production It is not possible to ascertain the same as company is having different process for different kind of production. (B) TECHNOLOGY ABSORPTION, ADOPTION & INNOVATION: The company is putting its best efforts towards research & developed in its own laboratory, to improve the quality of products and to test and try the latest technological innovations. (C) FOREIGN EXCHANGE EARNINGS AND OUTGO: Foreign exchange earnings : Foreign exchange outgo :

9 MANAGEMENT DISCUSSION AND ANALYSIS A.Business Overview The Company continues to see marginal growth in the financial year driven by the average performance in existing and new business. The total income increased to lacs from lacs in the previous year, at a rate of %. The Profit before Tax amounted to lacs as against lacs in the previous year. The net profit after tax was lacs as against lacs in the previous year. Your company has continued to put in all possible efforts to boost exports, during the year under review achieved Export sales to the tune of Lacs. B. Industry Structure and Development: Your Company operates mainly in two broad areas: Polymer Based Technical Textile Division and Traditional Textiles Division, whereas Traditional Textile Division is having two separate units for Weaving and Processing. Polymer Based Technical Textile & Rubber Division at MRT manufactures world class Textile Printing Blankets and range of other niche rubber products. Being widely used on all types of textile screen printing machines and, we are today one of the major Textile Printing Blanket manufacturer in the country with a long track-record and excellence in quality in this industry. Since long time MRT has been exporting its products to many countries. your Company operates across multiple products and business in diverse markets and environment. These includes manufacturing of Polymer Coated Engineered Fabrics, which has diverse end-uses. The Company has been regularly participating in international exhibitions which enable us to keep abreast with the latest global trends. Your company confirms to ASTM standards, Bureau of Indians standards, DIN standards, Federal Standards etc. and is an ISO 9001:2008 Company of this Division. During the year your Company has completed the expansion and diversification of project of phase I and successfully commenced production for the manufacturing of offset printing blankets (used in Sheet Fed and Web Fed printing machines).hence,the generation of revenue from Rubber / Technical Textile Division has started. Further your company has plans to expand its embit and scope of activities in the technical textile space, such as coated and laminated textiles,and Polymer Coated Engineered Composites Some of the emerging areas of technical textiles which the company plans to explore are in the field of Geotextiles, Healthcare, Safety & Protective Clothing, Industrial, Aerospace, Marine and Military sector. In textile division your Company operates in two separate units i.e. Maheeka Textech a weaving unit and Mahalaxmi Fabric Mills a Processing unit. Maheeka Textech is a high-tech weaving unit which includes warping, sizing and world-class automatic rapier looms for weaving of various types of fabrics. Maheeka Textech also has facility of manufacturing specialty fabrics used for the technical textiles., Your Company has complete facility from warping, sizing, weaving, dyeing, bleaching, printing, processing and finishing of various types of fabrics such as cotton, polyester, Bottom-weight etc. Mahalaxmi Fabric Mills a processing unit is engaged in dyeing, bleaching, printing and processing of various types of fabrics and at the end of the chain its fabric range goes in to high quality Apparel and Home textiles catering to Domestic as well as Global Market.Your company has continue plans for setting up new plant and machinery for technology upgradation and expansion under TUFS. C. Research & Development: Increased globalization has made the sale of products and retaining of customers highly competitive. To overcome a significant volatility in the market, the need of the hour is high customer satisfaction and value for money from the product. Keeping the above objective as paramount, the research and development activities were focused into attending major customer complaints/ suggestions in order to improve customer satisfaction. Your Directors are pleased to inform that the above efforts have lead to considerable reduction of customer complaints. Your company has successfully launched products of better quality with new aesthetic look as per customer requirements. Further your company also plans to make new investments for upgrading and modernizing their R & D facilities. D. Internal Control System: The Company has an adequate system of internal control implemented by the management towards achieving efficiency in operations, optimum utilization of resources and effective monitoring thereof and compliance with applicable laws. The internal control is supplemented by an extensive programme of internal audits. 7

10 The internal audit programme is finalized in consultation with the internal auditors and the audit committee of the Board. The Audit Committee is briefed on the findings by the internal auditors, every quarter, along with the remedial actions that have been recommended or have been taken by the management to plug systemic weaknesses. The audit committee of the Board meets periodically to review various aspects of the performance of the company and also review the adequacy and effectiveness of the internal control system and suggests improvement for strengthening then from time to time. E. Human Resources: Your Company continues to have cordial and harmonious relations with its employees at all levels during the period under review. The operations of the Company across functions have been strengthened through induction of appropriately qualified and experienced manpower. Management identifies the potential of each employee and endeavors by providing them right opportunity to grow. Management of your Company strongly focuses on the performance of the managers. The Board acknowledges it's thanks to all the shop floor personnel and other employees for making significant contribution to your Company. Our positive approach to competency, development and retention allows to attract, retain and built the best team. The Company attaches priority to human resource development, with focus on regular up-gradation of the knowledge and skills of our employees and equipping them with the necessary expertise to meet the challenges of change and growth successfully. F. ISO 9001:2008 Certification: We wish to inform you that your company has obtained the ISO 9001:2008 Certification, Accredited by TUV South Asia Private Limited, covering all major criteria Development and Manufacturing of Rubber Products such as Textile Printing Blankets, Rubber Coated Fabrics, Precision Rubber Moulded Parts, Flexible Separators and Hydraulic Seals. Throughout our corporate career, your company has been quality-focused and technology-driven. From our inception, these were the factors that enabled us to manufacture truly world class Textile Rubber Printing Blankets, Rubberised Textile Fabrics and offset printing blankates through in-house R&D, and successfully market them around the world. G. Cautionary Statement: Comments in this Management Discussion and Analysis outlining the Company's strategies and objectives are believed by the Management to be true and to the best of its knowledge at the time of preparation actual results may differ materially from those expressed or implied and hence the Company and the Management shall not be held responsible for any loss which may arise as a result of any action taken on the basis of information contained herein. Important factors that could influence the Company's operations include global and domestic supply and demand conditions affecting selling prices of finished goods, input availability and prices, changes in government regulations, tax laws, economic developments within the country and outside the country and other factors such as litigation and industrial relations. 8

11 CORPORATE GOVERNANCE Report on the implementation of the Corporate Governance is furnished below: 1. Company's Philosophy on Code of Governance: Your Company's Philosophy on Corporate Governance is built on rich legacy of fair, transparent and effective governance which includes strong emphasis on human values, individual dignity and adherence to honest, ethical and professional conduct. The Company remained committed towards protection and enhancement of overall long term value for its entire stakeholder, customer, lender, employee and society. The Company adheres to good corporate practices and is constantly striving to make them better. The Company strongly supports the principles of corporate governance. Further the board lays emphasis on transparency, accountability and integrity in all its operations and dealings with outsiders. Your company has complied with all material respects with the features of Corporate Governance Code as per clause 49 of the Listing Agreement with the Stock Exchange. 2. Board of Directors: The Board consists of six directors of whom one is Non-executive Chairman, two Managing Directors and three Non-Executive Directors (Independent). During the year 7 Board Meetings were held on , , , , , and The interval between any two meetings did not exceed 4 months. The Composition of Directors and their attendance at the Board Meeting during the year and also number of other directorships/ membership of Committees are as follows: Name of Director Category of Directorship No. of Board Meetings Attended Whether Attended Last AGM No. of other Directorships Committee Membership ** Jeetmal B. Parekh NED-P 7 YES *4 2 0 Rahul J. Parekh MD 7 YES *6 1 1 Anand J. Parekh JT. MD 7 YES *3 3 - Nikhil K. Parikh NED-I 5 NO NIL 1 1 Nehal M. Shah NED-I 5 NO * Chairmanship ** Malav J. Ajmera NED-I 7 YES * All Private Limited Company ** As required by Clause 49 of the Listing Agreement, the disclosure includes memberships / chairmanships of audit committee, Remuneration Committee, Share Transfer Committee and investors' grievance committee in public limited companies. NED -P - Non Executive Director (Promoter), MD - Managing Director, JT. MD Joint Managing Director, ED - Executive Director, NED-I - Non Executive Director (Independent) Shri Jeetmal B. Parekh is a Non-Executive Chairman, Shri Rahul J. Parekh and Shri Anand J. Parekh are Managing Directors, Shri Nikhil K. Parikh, Shri Nehal M. Shah & Shri Malav J. Ajmera are Non Executive Directors (Independent). 3. Audit Committee: 1. Composition and Terms of Reference: As on your Company's Audit Committee consisted of Shri Malav J. Ajmera Chairman of the Audit Committee, Shri Anand J. Parekh and Shri Nikhil K. Parikh. All members of the Audit Committee have Financial, Accounting and Management expertise. The Chairman of the Audit Committee has attended Annual General Meeting held on

12 During the year 4 committee meetings held on , , and the attendance of members at the meetings were as follows: Name of Member Status No. of Meetings Attended Malav J. Ajmera Chairman 4 Nikhil K. Parikh Anand J. Parekh Member Member 4 4 Two third members are non-executive and Independent Directors. The Chairman of the Committee is an Independent Director. The Compliance Officer is regular invitee and statutory auditors are invited from time to time. The terms of reference of the Audit Committee cover the matters specified for Audit Committees under Clause 49 of the Listing Agreement with the Stock Exchanges and also as required under Section 292A of the Companies Act, The Chief Financial Officer, along with the Statutory Auditors, Internal Auditors and the Cost Auditor of the Company are invited to the Meetings of the Audit Committee to recommend the appointment of Statutory Auditors, Cost Auditor and fixation of the audit fees and other payments after compliance of relevant clause of listing agreement. The Board of Directors notes the Minutes of the Audit Committee Meetings at Board Meeting. 4. Remuneration Committee (Non Mandatory) The Remuneration Committee inter alia, reviews and recommends the remuneration and commission / performance incentive of Executive and Non Executive Directors. The Terms of reference of the Remuneration Committee include the matters specified in Clause 49 of the Listing Agreement with the Stock Exchanges. The committee comprises of 3 Non-Executive directors, Mr. Nikhil K.Parikh as Chairman and Mr.Jeetmal B. Parekh, Mr. Malav J. Ajmera as members. During the year under review, the committee met on where all members were present in the meeting. Details of Remuneration for the year paid to the Directors are as follows: Remuneration for the year to Shri Rahul J. Parekh, Managing Director:- i. Salary : 9,60,000/-, (Rupees Nine Lacs Sixty Thousand only), Perquisites: 32,400/- (Rupees Thirty two Thousand Four Hundred Only) Remuneration for the year to Shri Anand J. Parekh, Jt. Managing Director:- ii. Salary Rs: 9,60,000/- (Rupees Nine Lacs Sixty Thousand only), Perquisites: 32400/- (Rupees Thirty two thousand four hundred only) The other information of Directors are as under: Name Age Designation Date of initial Nature of Shares held Jeetmal B. Parekh Rahul J. Parekh Anand J. Parekh Nikhil K. Parikh Nehal M. Shah Malav J. Ajmera Chairman Managing Director Jt. Managing Director Director Director Director As Per terms of Appointment As Per terms of Appointment NIL NIL NIL The company does not pay any remuneration for attending the Board / Committee Meeting to Non-executive directors. There is no pecuniary relationship or transaction of the company with any non-executive directors. 10

13 5 CEO/CFO CERTIFICATION: The Managing Director and CFO have certified to the Board that: a) We have reviewed financial statements and the cash flow statement for the year ended and that to the best of our knowledge and belief : i) These statements do not contain any materially untrue statement or omit any material fact or contain statements that might be misleading. Ii) These statements together present a true and fair view of the Company's affairs and are in compliance with existing accounting standards, applicable laws and regulations. b) There are, to the best of our knowledge and belief, no transactions entered into by the Company during the year, which are fraudulent, illegal or violative of the Company's code of conduct. c) We accept responsibility for establishing and maintaining internal controls and that we have evaluated the effectiveness of the internal control systems of the Company and we have disclosed to the auditors and the Audit Committee, deficiencies in the design or operation of internal controls, if any, of which we are aware and the steps we have taken or propose to take to rectify these deficiencies. d) We have indicated to the auditors and the Audit Committee i) Significant changes in internal control during the year. ii) Significant changes in accounting policies during the year and that the same have been disclosed in the notes to the financial statements. Iii) Instances of significant fraud of which we have become aware and the involvement therein, if any, of the management or an employee having a significant role in the Company's internal control system. For Mahalaxmi Rubtech Limited Rahul J. Parekh Managing Director Place: Ahmedabad Date: May 30, 2013 Rajendra R. Mehta Chief Financial Officer 6. Shareholders / Investors Grievance Committee : Terms of Reference To specifically look into redressal of complaints like transfer of shares, non-receipt of dividends, non-receipt of annual report etc. received from shareholders / investors and improve the efficiency in investors' service, wherever possible. The shareholders' Grievance Committee comprise of Non-Executive director (independent), and two Executive Directors. The committee met five times during the year on , , and and all the members of committee attended the meeting. Members: Shri Nehal M. Shah - Chairman Shri Rahul J. Parekh - Member Shri Anand J. Parekh - Member Shri Japan Shah, Company Secretary is a Compliance Officer. During the year company has received 4 complaints, which were resolved on time and no complaint remains pending at year end. The status of complaints is periodically reported to the Committee and Board of Directors in their meetings. 11

14 7. Share Transfer Committee: The board has delegated the power of approving transfer of shares to a committee of Three directors, committee met 11 times during the year and approved the transfer of shares lodged with the company and no transfer were pending as on General Body Meeting: The last three Annual General Meetings of the Company were held on the following locations, dates & times: Year Location Date Time Lions Hall, Nr. Nalanda Hotel, Mithakhali Six Roads, Ellisbridge, Ahmedabad Lions Hall, Nr. Nalanda Hotel, Mithakhali Six Roads, Ellisbridge, Ahmedabad Lions Hall, Nr. Nalanda Hotel, Mithakhali Six Roads, Ellisbridge, Ahmedabad No. of Special Resolutions passed AM PM PM 0 Postal Ballot: The Company has not passed any resolution through postal ballot during the years under reference. None of the resolutions proposed for the ensuing Annual General Meeting need to be passed through Postal Ballot. 9. Disclosures: Details of related party transactions are furnished in Note No.32 of Financial Statements with any of the related parties were in conflict with the interest of the company. No strictures or penalties have been imposed on the company by the Stock Exchange or SEBI or any statutory authority on any matters related to capital market during the last three years. The Company has put in place a mechanism for employees to report to the Management, concerns about unethical behavior, actual or suspected fraud or violation of Company's Code of Conduct or Ethics Policy. The said policy provides for adequate safeguards against victimization of employees who avail of the mechanism and also provides for direct access to the higher levels of supervisors including the Audit Committee. The Board has adopted Code of Conduct including a Business Ethics Policy for its Designated Persons. Designated Persons mean Directors and Officers in Management Cadre - functional heads and above. The Company has for the period ended, received from all Designated Persons, a declaration of compliance with the code. A certificate from the Managing Director, to this effect forms part of this Report. The Company follows the Accounting Standards issued by the Institute of Chartered Accountants of India and in the preparation of the financial statements, the Company has not adopted a treatment different from that prescribed by any Accounting Standard. The Company has complied with all mandatory requirements of Clause 49 of the Listing Agreements with Stock Exchanges. The adoption of non-mandatory requirements has been dealt with further on in this Report. 10. Means of Communication: Financial Results : The Quarterly & Half Yearly results are published in Indian Express English and Financial Express Gujarati Edition. The said Financial Results are also available on the Company's website Management Discussion and Analysis Report : The Management Discussion and Analysis Report forms a part of the Annual Report. 12

15 11. The of Directors who are proposed to be appointed/reappointed are given below: Sr. No. Name Age Occupation Qualification Expertise Other Directorship Other Committee Membership 1 He is a Master of Business Nehal 41 Business M.B.A. Administration in international M. Shah Finance. He has rich experience 10 2 in dealing of FMCG Products at International level. He also posses excellent expertise in the Finance field and also in the field accounting 12. General Shareholder information Annual General meeting to be held on Place of the meeting Tentative Financial Calendar Financial Results * First Quarter Results *Half Yearly Results *Third Quarter Results *Annual Results Book Closure Date Dividend Payment date Listing at Stock Exchanges: Name of Stock Exchange Bombay Stock Exchange Limited ISIN NO. (dematerialized Shares) Corporate Identity Number (CIN) : : : : : : : : : : : : : th Saturday, 28 September 2013 At p.m. Lions Hall, Nr. Nalanda Hotel, Mithakhali Six Road, Ellisbridge, Ahmedabad st st 1 April 2013 to 31 March 2014 th By 14 August, 2013 th By 14 November 2013 th By 14 February 2014 Within 60 days st th From 21, September, 2013 to 28, September, 2013 (both days inclusive) N.A. Stock Code INE112D01027 L25190GJ1991PLC The Company has already paid listing fees for the year to all the Stock Exchanges, where listed. Market Price Data: (as per BSE) Month April, 2012 May, 2012 June, 2012 July, 2012 August, 2012 September, 2012 October, 2012 November, 2012 December, 2012 January, 2013 February, 2013 March, 2013 Highest Rate () Lowest Rate ()

16 REGISTRAR AND TRANSFER AGENTS Physical Mode: Sharepro Services (India) Pvt. Ltd , 4th Floor, Devnandan Mall, Opp.Sanyash Ashram, Ellisbridge, AHMEDABD Tel Nos to 84 Fax No Depository Mode: 1. For National Securities Depository Ltd. (NSDL) Sharepro Services (India) Pvt. Ltd , 4 th Floor, Devnandan Mall, Opp. Sanyash Ashram, Ellisbridge, AHMEDABD Tel Nos to 84 Fax No sharepro.ahmedabad@shareproservices.com 2. For Central Depository Services (India) Ltd. (CDSL) Sharepro Services (India) Pvt. Ltd , 4 th Floor, Devnandan Mall, Opp. Sanyash Ashram, Ellisbridge, AHMEDABD Tel Nos to 84 Fax No sharepro.ahmedabad@shareproservices.com Share Transfer System: The Company's Shares are traded in the Stock Exchanges compulsorily in demat mode. Share in physical mode which are lodged for transfer are processed and subject to exercise of option under compulsory transfer-cum-demat procedures, Shares Certificates are either dematted or returned within the time prescribed by the authorities. The Shareholders/Investors are requested to send share transfer related documents directly to our RTA whose address is given at the beginning of this section. Distribution of Share holding: (as on 31 st March 2013) No. of Shares Shareholders No. of Share held Number Total in % Numbers Total in % Total AND ABOVE Shareholding Pattern: (As on 31 st March, 2013) Category No. of Shares held % to the Shareholding Promoters & Associates Bodies Corporate Non Resident Indians Banks & Mutual Funds Public Dematerialisation of Share and liquidity: The trading of Equity shares of the Company in all category is Compulsory in demat mode with effect from st As on 31 March, 2013, 98.15% Shares have been dematerialized. Outstanding GDRs / ADRs / Warrants or any Convertible Instruments, Conversion date and likely impact on equity : NIL Shareholders who have not yet encashed their dividend warrants for the year, , , , , and may approach the Company for revalidation / issue of duplicate dividend warrant. 14

17 PLANT LOCATION: Address for Correspondence: Factory: (1) Uma Industrial Estate Phase III, Village Vasana (Iyava), Tal. Sanand, Dist. Ahmedabad, Tel: Fax: (2) Mahalaxmi Fabric Mills (A Unit of Mahalaxmi Rubtech Ltd.) Isanpur Road, Nr. Narol Char Rasta, Narol, Ahmedabad Tel: Fax: Registered Office: 47, New Cloth Market, Ahmedabad Tel: Corporate office: 507, Chanakya, Near Dinesh Hall, Ashram Road, Ahmedabad Tel: , Fax: Declaration by the Managing Director under Clause 49 of the Listing Agreement Regarding Compliance with the Code of Conduct In accordance with Clause 49 I (D) of the Listing Agreement with the Stock Exchanges, I hereby confirm that, all Designated Persons of the Company have affirmed compliance with the Code of Conduct, as applicable to them, for the period ended st 31 March, For the purpose of this declaration, Designated Persons mean Directors and Officers in Management Cadre and above. Place: Ahmedabad Date: May 30, 2013 On behalf of the Board of Directors, Rahul J. Parekh Managing Director COMPLIANCE WITH THE CONDITIONS OF CORPORATE GOVERNANCE UNDER CLAUSE 49 OF THE LISTING AGREEMENT. To the Members of Mahalaxmi Rubtech Limited We have examined the compliance of conditions of Corporate Governance by Mahalaxmi Rubtech Limited, for the year ended, as stipulated in Clause 49 of the Listing Agreement of the said Company with the stock exchanges. The compliance of conditions of Corporate Governance is the responsibility of the management. Our examination was limited to procedures and implementation thereof, adopted by the Company for ensuring the compliance of the conditions of Corporate Governance. It is neither an audit nor an expression of opinion on the financial statements of the Company. In our opinion and to the best of our information and according to the explanations given to us, and the representation made by the Directors and the Management, we certify that the Company has complied with the conditions of Corporate Governance as stipulated in Clause 49 of the above mentioned listing Agreement. We state that in respect of investor grievances received during the year ended, no investor grievances are pending against the Company as per records maintained by the Company and presented to the Shareholders/Investors Grievance Committee. We further state that such compliance is neither an assurance as to the future viability of the Company nor the efficiency or effectiveness with which the management has conducted the affairs of the Company. For BHANWAR JAIN & CO. Chartered Accountants. (B. M. Jain) Partner th Ahmedabad: 30 May,

18 TO THE MEMBERS OF MAHALAXMI RUBTECH LIMITED. Report on the Financial Statements AUDITORS' REPORT We have audited the accompanying financial statements of MAHALAXMI RUBTECH LIMITED ( the Company ), which comprise the Balance Sheet as at, the statement of profit and loss and Cash Flow Statement for the year ended and a summary of significant accounting policies and other explanatory information. Management's Responsibility for the Financial Statement Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in the India including Accounting Standards referred to in Section 211 (3C) of the Companies Act, 1956 ( the Act ). This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error. Auditors' Responsibility Our responsibility is to express an opinion on these financial statements based on our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatements. An audit involves performing procedures to obtain audit evidence about the amounts and disclosure in the financial statements. The procedures selected depend on the auditor's judgments, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessment, the auditor considers internal control relevant to the Company's preparation and fair presentation of the financial statements in order to design audit procedure that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Opinion In our opining and to the best of our information and according to explanations given to us, the aforesaid financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India. (a) In the case of the Balance sheet, of the state of affairs of the Company as at ; (b) In the case of the Statement of Profit and Loss, of the profit for the year ended on that date; and (c) In the case of the Cash Flow Statement, of the cash flows for the year ended on that date. Report on Other Legal and Regulatory Requirements (1). As required by the Companies (Auditor's Report) Order, 2003, ( the Order ) issued by the Central Government of India in terms of Section 227(4A) of the Act, we give in the Annexure a statement on the matters specified in paragraph 4 & 5 of the Order. (2). As required by section 227(3) of the Act, we report that; (a) We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purposes of our audit; (b) In our opinion, proper books of account as required by law have been kept by the Company, so far as appears from our examination of those books. (c) The balance sheet, the statement of profit and loss, and cash flow statement dealt with by this Report are in agreement with the books of account. (d) In our opinion, the balance sheet, the statement of profit and loss, and cash flow statements comply with the Accounting Standards referred to in section 211(3C) of Act; (e) On the basis of written representations received from the directors as on and taken on record by the Board of Directors, none of the directors is disqualified as on from being appointed as a director in terms of section 274(1)(g) of the Companies Act, For BHANWAR JAIN & CO. Chartered Accountants. Registration No. : W ( B. M. JAIN ) Partner. M. No. : AHMEDABAD: 30th May,

19 ANNEXURE REFERRED TO IN PARAGRAPH 3 OF OUR REPORT OF EVEN DATE (i) (a) The company has maintained proper records showing full particulars including quantitative details and situation of fixed assets. (b) As explained to us, the fixed assets have been physically verified by the management during the year. In our opinion, the frequency of verification is reasonable having regard to the size of the company. No material discrepancies were noticed on such verification. (c) There was no disposal of substantial part of fixed assets during the year. (ii) (a) As explained to us, the inventory has been physically verified during the year by the management. In our opinion, the frequency of verification is reasonable. (b) According to the information and explanation given to us, the procedures of physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the company and the nature of its business. (c) On the basis of our examination of records of inventory, the company has maintained proper records of inventory and no material discrepancies were noticed on physical verification. (iii) (a) According to the information and explanation given to us, the company has not granted any loans, secured or unsecured to the companies, firms or other parties covered in register maintained under section 301 of the Companies Act, Accordingly Para 4(iii) (b), (c) and (d) of the Companies (Auditors Report) Order, 2003 are not applicable. (b) According to the information and explanation given to us company has taken loans, secured or unsecured from Four companies, firms or other parties covered in register maintained under section 301 of the Companies Act, 1956.The maximum amount involved during the year was lakhs and the year end balance of the loan taken from such parties was lakhs. (c) In our opinion, the rate of interest and other terms and conditions on which loans have been taken from companies, firms or other parties listed in the register maintained under section 301 of the Companies Act, 1956 are not, prima facie, prejudicial to the interest of the company. (d) The company is regular in repaying the principal amounts as stipulated and has been regular in the payment of interest. (iv) (v) In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the company and the nature of its business for the purchases of inventory and fixed assets and for the sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control system. (a) According to the information and explanations given to us, the particulars of contracts or arrangements referred to in section 301 of the Companies Act, 1956 have been entered in the register required to be maintained under that section. (b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered in the register maintained under section 301 of the Companies Act, 1956 and exceeding Rupees five lakhs in respect of any party during the year have been made at prices which are reasonable having regard to prevailing market prices at the relevant time. (vi) (vii) According to the information and explanations given to us, the company has not accepted any deposits during the year from the public within the meaning of the provisions of section 58A, 58AA or any other relevant provisions of the Companies Act, 1956 and rules made there under. The company has an internal audit system during the year which in our opinion is in commensurate with the size and nature of its business. (viii) We have broadly reviewed the cost records maintained by the company pursuant to the rules made by the Central Government for the maintenance of cost records under section 209 (1) (d) of the Companies Act, 1956 and are of the opinion that prima facie, the prescribed accounts and records have been maintained by the company. 17

20 (ix) (a) According to the information and explanations given to us, in our opinion, undisputed statutory dues including provident fund, investor education protection fund, employees' state insurance, income tax, sales tax, wealth tax, service tax, custom duty, excise duty, cess and other material statutory dues, applicable to the company have generally been regularly deposited with the appropriate authorities. According to the information and explanations given to us, no undisputed amounts payable in respect of income tax, wealth tax, sales tax, custom duty, excise duty and cess were in arrears as at 31st March,2013 for a period of more than six months from when they became payable. (b) According to the information and explanation given to us, the disputed statutory dues that have not been deposited on account of matters pending before appropriate authorities are as under: Name of the Statute Amount in Forum where dispute is pending (Lakhs) Central Excise Duty Textile Cess Income Tax Income Tax Labour Suits Appellate Tribunal High Court High Court Appellate Tribunal Labour Court (x) (xi) (xii) (xiii) (xiv) (xv) (xvi) st There are no accumulated losses of the company as on 31 March, The company has not incurred cash losses during the financial year covered by our audit and in the immediately preceding financial year. In our opinion and according to the information and explanations given to us, the company has not defaulted in repayment of dues to a financial institution or banks during the year. In our opinion and according to the information and explanations given to us, the company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures or other securities. The provisions of any special statute as specified under clause 4 (xiii) of the Order are not applicable to the company. According to the information and explanation given to us, the company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4 (xiv) of the Order are not applicable to the company. According to the information and explanation given to us, the company has not given any guarantee for loans taken by others from banks or financial institutions. According to the information and explanation given to us, the term loans raised during the year have been applied for the purpose for which they were raised. (xvii) (xviii) According to the information and explanations given to us and on an overall examination of the balance sheet of the company, we report that the no funds raised on short-term basis have been used for long-term investment by the company. The Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Act during the year. (xix) (xx) (xxi) The company has not issued any debentures during the year. The company has not raised any money by way of public issues during the year. During the course of our examination of books and records of the Company carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanation given to us, we have neither come across any instance of fraud on or by the company, notice or reported during year, nor we have been informed of any such case by the management. For BHANWAR JAIN & CO. Chartered Accountants. Registration No. : W ( B. M. JAIN ) Partner. M. No. : AHMEDABAD: 30th May,

21 MAHALAXMI RUBTECH LIMITED BALANCE SHEET MARCH 31, 2013 PARTICULARS NOTE No. 31/03/ /03/2012 EQUITY AND LIABILITIES Shareholder's Funds Share Capital Reserves & Surplus Non-Current Liabilities Long Term Borrowings Deferred Tax Liabilities (Net) Other Long Term Liabilities Current Liabilities Short Term Borrowings Trade Payables Other Current Liabilities Short Term Provisions ASSETS Non-current assets Fixed Assets (i) Tangible assets (ii) Capital work-in-progress Non Current investment Long Term Loans & Advances Other Non-current Assets Current assets Inventories Trade Receivables Cash & Cash Equivalents Short Term Loans & Advances Other Current Assets The Notes forming an integral part of these financial statements As per our report of even date For BHANWAR JAIN & CO. Chartered Accountants. Firm Registration No. : W JEETMAL B. PAREKH Chairman RAHUL J. PAREKH Managing Director ANAND J. PAREKH Jt. Managing Director ( B. M. JAIN ) Partner. Membership No. : AHMEDABAD: 30th May, AHMEDABAD: 30th May, NIKHIL K. PARIKH Director JAPAN N. SHAH Company Secretary 19

22 MAHALAXMI RUBTECH LIMITED PROFIT AND LOSS FOR THE YEAR ENDED 31ST MARCH, PARTICULARS NOTE No. 31/03/ /03/2012 Revenue from Operations Other Income Total Revenue EXPENSES: Cost of Raw Materials consumed & Trading Purchase Changes in Inventories Manufacturing & Operating Costs Employees' Benefit Expenses Financial Cost Depreciation & Amortization Expenses Other Expenses Total Expenses Profit Before Tax Tax Expense: Current Income Tax Less: MAT Credit Wealth Tax Deferred Tax Net Profit for the year Earning per equity share of Re.1: Basic Diluted ( ) The Notes forming an integral part of these financial statements As per our report of even date For BHANWAR JAIN & CO. Chartered Accountants. Firm Registration No. : W JEETMAL B. PAREKH Chairman RAHUL J. PAREKH Managing Director ANAND J. PAREKH Jt. Managing Director ( B. M. JAIN ) Partner. Membership No. : AHMEDABAD: 30th May, AHMEDABAD: 30th May, NIKHIL K. PARIKH Director JAPAN N. SHAH Company Secretary 20

23 A. MAHALAXMI RUBTECH LIMITED CASH FLOW STATEMENT FOR THE YEAR ENDED 31ST MARCH, CASH FLOW FROM OPERATING ACTIVITIES : Net Profit before tax and extraordinary items Adjustment for : Depreciation Interest Paid Deferred Revenue Expenses written off Liabilities written back Profit on sale of Fixed Assets Profit on sale of Investment Loss on sale of Fixed Assets Loss on sale of Investment Exchange Rate Fluctuation Bad Debts written off ( in Lakhs) Inflow/(Outflow) 31/03/ /03/ (42.10) (55.32) (3.23) (0.24) (14.41) (4.77) (0.41) (0.05) OPERATING PROFIT BEFORE WORKING CAPITAL CHANGES Adjustment for : Trade & Other Receivables Inventories Trade Creditors & Other Payables (201.14) (428.77) CASH GENERATED FROM OPERATIONS Income Tax Paid (154.67) (283.26) CASH FLOW BEFORE EXTRAORDINARY ITEMS Deferred Revenue Expenses (25.52) (5.20) NET CASH FROM OPERATING ACTIVITIES B. CASH FLOW FROM INVESTING ACTIVITIES : Purchase of Fixed Assets Sale of Fixed Assets Sale of Investments Purchase of Investments ( ) ( ) NET CASH USED IN INVESTING ACTIVITIES (983.67) ( ) C. CASH FLOW FROM FINANCING ACTIVITIES : Proceed from long term Borrowings Working Capital Finance Interest Paid Dividend Paid Corporate Dividend Tax Paid (194.92) (44.10) (7.15) (184.87) (44.10) (7.15) NET CASH SURPLUS IN FINANCING ACTIVITIES D. NET INCREASE(DECREASE) IN CASH AND CASH EQUIVALENTS E. Cash and cash equivalent as at 1st April, F. Cash and cash equivalent as at 31st March, As per our report of even date For BHANWAR JAIN & CO. Chartered Accountants. Firm Registration No. : W JEETMAL B. PAREKH Chairman RAHUL J. PAREKH Managing Director ANAND J. PAREKH Jt. Managing Director ( B. M. JAIN ) Partner. Membership No. : AHMEDABAD: 30th May, AHMEDABAD: 30th May, NIKHIL K. PARIKH Director JAPAN N. SHAH Company Secretary 21

24 NOTES TO THE FINANCIAL STATEMENTS: NOTE: 1. SHARE CAPITAL AUTHORISED: ( ) Equity Shares of Re.1/-each ISSUED & SUBSCRIBED & PAID UP ( ) Equity Shares of Re.1 each fully paid NOTES: Equity Shares include shares issued as fully paid up Bonus Shares and shares issued pursuant to a scheme of amalgamation of erstwhile Mahalaxmi Fabric Mills P Ltd. with the company without payment received in cash The Company has only one class of equity shares having a par value of Re.1 per share. In the event of liquidation of the Company, the holders of equity shares will be entitled to receive any of the remaining assets of the company, after distribution of all preferential amounts, in proportion of their shareholding. However, no such preferential amounts exist currently. The reconciliation of the number of shares outstanding and the amount of share capital: No. of shares No. of shares Number of Shares Outstanding at the beginning of the year Add/Less: Adjustment during the year Number of Shares Outstanding at the end of the year The details of shareholders holding more than 5% of shares in the company: No. of shares % of Holding No. of shares % of Holding Jeetmal B. Parekh & HUF Rahul J. Parekh Kamlaben J. Parekh Anand J. Parekh

25 NOTE: 2. RESERVES & SURPLUS General Reserve As per last year Balance Sheet Capital Reserve As per last year Balance Sheet Surplus Opening balance Add: Net Profit for the year Less: Proposed Dividend Less: Tax on Proposed Dividend Less: Income Tax /Wealth Tax of eariler years NOTE: 3. LONG TERM BORROWINGS Deferred payment liabilities Secured by way of hypothication of vehicles from: Kotak Mahindra Prime Ltd Tata Capital Ltd HDFC Ltd Term loan Secured From Banks Rupee Loan Foreign Currency Loan Loans and advances from related parties: Unsecured From Directors From Companies

26 Nature of Securities and terms of repayment for Term Loan Borrowings: Term Loan Balance Outstanding 1Term Loan of Lacs Terms of Repayment Repayable in 60 monthly installments commencing from April, Last installment due in March, Term Loan of Lacs 3 Term Loan of Lacs 4 Term Loan of Lacs 5 Term Loan of 6.98 Lacs 6 Term Loan of 8.63 Lacs 7 Term Loan of Lacs 8 Term Loan of Lacs 9 Term Loan of Lacs Repayable in 71 monthly installments commencing from January Last installment due in November, Repayable in 24 quarterly installments commencing from September, Last installment due in June, Repayable in 72 monthly installments commencing from January, Last installment due in December, Repayable in 60 monthly installments commencing from March, Last installment due in August, Repayable in 60 monthly installments commencing from February, Last installment due in November, Repayable in 72 monthly installments commencing from June, Last installment due in July, Repayable in 72 monthly installments commencing from June, Last installment due in May, Repayable in 60 monthly installments commencing from April, Last installment due in March, Nature of Security Secured by way of hypothecation of stock, book debts, plant & machineries & other movables and equitable mortgage of land and buildings and further secured by personal guarantee of promoter directors NOTE: 4. DEFERRED TAX LIABILITY/ASSET (NET) Deferred Tax Liability i. On account of timing difference relating to depreciation ii Others ( ) ( ) NOTE: 5. OTHER LONG TERM LIABILITIES Provision for Gratuity

27 NOTE: 6. SHORT TERM BORROWING Secured Working Capital facilities from Banks Secured by way of hypothecation of stock, book debts, plant & machineries & other movables and equitable mortgage of land and buildings and further secured by personal guarantee of promoter directors NOTE: 7. OTHER CURRENT LIABILITIES Advances from Customers Statutory Dues Unclaimed Dividend Outstanding Expenses Unpaid Salary & Bonus Overdrawn Bank Balances NOTE: 8. SHORT TERM PROVISIONS PROVISIONS: For Taxation For Wealth Tax For Proposed Dividend For Tax on Proposed Dividend NOTE: 9. S. NO. PARTICULARS TANGIBLE ASSETS GROSS BLOCK DEPRECIATION/AMORTISATION NET BLOCK As on As on Upto Previ- During As on As on Additions Deductions Recouped Total ous year the year Freehold Land Leasehold Land Building Plant & Machinery Electric Installation Furniture Fixtures Office Equipments Vehicles Current Year Total Prev. Year Total

28 NOTE: 10. NON CURRENT INVESTMENT (As valued, verified & certified by the management ) Investment in Associates : (Unquoted - Non Trade) 700 (700) Equity Shares of Rahul Cal Chem Pvt. Ltd..of 100 each fully paid 685 (685) Equity Shares of Mahalaxmi Calchem Pvt. Ltd..of 100 each fully paid Investment in Others : (Quoted - Non Trade) 25 (25) Equity Shares of Reliance Power 10 each fully paid Investment in Others : (Unquoted - Non Trade) 1 (1) Share of The Social Co-op Bank Ltd. of 100 each fully paid up NIL (518) Bonds of Nabard NIL 8.26% Bonds of Govt. of India The details of aggregate of quoted and unquoted investment: Book Value As At As At As At Market Value As At Aggregate Quoted Investment Aggregate Unquoted Investment NOTE: 11. LONG TERM LOANS AND ADVANCES Capital Advances Unsecured and considered good Security Deposits Unsecured and considered good Other Loans & Advances (Unsecured & considered good) Margin Money with Banks NOTE: 12. OTHER NON CURRENT ASSESTS Deferred Revenue Expenses Issue Expenses Merger Expenses

29 NOTE: 13. INVENTORIES (As verified, valued & certified by management) Raw Materials Finished Goods Semi-finished Goods Fents & Rags Stores, Spares, Packing & Design Materials Trading Goods A. B. C. D. The details of closing stock of Raw Materials - Yarn - Grey Fabric - Rubber Compound - Chemical Solvents The details of closing stock of finished goods: - Rubber Printing Blankets - Grey & Finished Fabric - Processed Fabric The details of closing stock of semi finished goods: - Rubber Printing Blankets - Grey & Finished Fabric - Processed Fabric The details of closing stock of trading goods: - Offset Printing Blanket NOTE: 14. TRADE RECEIVABLES Debts exceeding six months Unsecured and considered good Doubtful Other debts Unsecured and considered good Doubtful The details of debts due from directors or officers or any of them either severally or jointly with other persons or amounts due by firms or private companies respectively in which any directors is partner or a director or a member: Due from Directors and Officers Due from firms or private companies in which directors are partners or a director

30 NOTE: 15. CASH & BANK BALANCES Cash & Cash Euivalents Cash on hand Balances with banks Other Bank Balances Balances with Banks held as margin money NOTE: 16. Loans and advances to others a. to Related Parties b. to Others Unsecured and considered good Doubtful SHORT TERM LOANS & ADVANCES NOTE: 17. OTHER CURRENT ASSETS Prepaid expenses Accrued Income Claims & Other Receivables NOTE: 18. REVENUE FROM OPERATIONS Sales of Products Less: Excise Duty Sales of Trading Goods Job Work Receipts A. B. The details of Sales of products: - Rubber Printing Blankets - Grey & Finished Fabric - Processed Fabric - Others The details of Sales of Trading Goods - Cloth - Offset Printing Blanket

31 NOTE: 19. OTHER INCOME Exchange Rate Fluctuation Export Entitlement Benefits Sale of Scrap Insurance Claims Liability Written Back Vatav Kasar Profit on Sale of Investments Profit on Sale/disposal of Fixed Assets Excise Duty/Service Tax Refund NOTE: 20. COST OF RAW MATERIALS CONSUMED & TRADING PURCHASE Raw Materials Consumed Opening Stock Add: Purchases Less: Closing Stock Purchase of Trading Goods A. B. The details of Raw material consumed: Yarn Rubber Compound Grey Cloth / Fabrics Chemical & Solvents The details of Purchase of Trading Goods - Cloth - Offset Printing Blanket

32 NOTE: 21. CHANGES IN INVENTORIES Closing Stock Finished Goods Semi Finished Goods Trading Goods Fents & Rags Opening Stock Finished Goods Semi Finished Goods Trading Goods Fents & Rags Changes in Inventories ( ) NOTE: 22. MANUFACTURING & OPERATING COSTS Stores,Spares & Maintenance Job Charges Paid Design Expenses Power & Fuel Expenses Labour Charges Laboratory Expenses Freight, Clearing & Farwarding Expenses Central Excise Duty Pollution Control Expenses NOTE: 23. EMPLOYEES BENEFIT EXPENSES Salaries, Wages & Bonus Contribution to Provident & Other Funds Employees' Welfare Expenses NOTE: 24. FINANCIAL COSTS Interest Bank Commission & Charges

33 NOTE: 25. OTHER EXPENSES E.C.G.C. Premium Telecommunication Expenses General Expenses Insurance Premium Advertisement Expenses Audit Fees Car Expenses Packing Materials Expenses Legal & Consulting Expenses Postage & Courier Expenses Rent, Rates and Taxes Preliminary Expense Written Off Deffered Revenue Expenses written off Loss on Sale of Fixed Assets Loss on Sale of Investments Miscellaneous Expenses Value Added Tax Export Freight Commission Expenses Factory Expenses Service Tax Printing & Stationery Expenses Travelling Expenses Exibition Expenses NOTE: 26. THE DETAILS OF PAYMENT TO AUDITORS: Audit fee Tax Audit For Others (Reports, Certificates, etc.) NOTE: 27. THE DETAILS OF PAYMENTS MADE TO MANAGING DIRECTOR / DIRECTORS: Remuneration Perquisite NOTE: 28. VALUE OF IMPORTS CALCULATED ON C.I.F. BASIS: Trading Goods Capital Goods

34 NOTE: 29. THE DETAILS OF EARNING IN FOREGN CURRENCY: Exports of goods calculated on F.O.B. Value Basis (Net of Export Commission) NOTE: 30. THE DETAILS OF EXPENDITURE INCURRED IN FOREGIN CURRENCY EQUIVALENT TO INDIAN RUPEES: Capital Goods Trading Goods Traveling Expenses Exhibition Expenses Export Commission Consultancy Expenses CDM (Registration) Charges NOTE: 31. THE DETAILS OF CONTINGENT LIABILITIES AND COMMITMENTS (TO THE EXTENT NOT PROVIDED FOR): A Contingent Liabiities: 1 Bank Guarantee 2 Textile Cess 3 Disputed Excise Duty Liability 4 Disputed Income Tax Liability 5 Claims against suits filed In Labour Courts not acknowledged by the company 6 Claims against suits by others not acknowledged by the company B Commitments: 1 Estimated amount of capital contacts remaining to be executed on capital account and not provided for (Net of Advances) NOTE: 32. RELATED PARTY TRANSACTIONS: (a) As per Accounting Standard 18, Related Party Disclosure is as under: List of Related Parties with whom transactions have taken place during the year and relationship: Name of the Related Party Shah Jeetmal Champalal Mahalaxmi Cal Chem Pvt. Ltd Anand Chem Industries Pvt. Ltd. Mahalaxmi Exports Rahul Textile Jeetmal B Parekh Rahul J Parekh Anand J. Parekh Relationship Associate Associate Associate Associate Associate Key Managerial Personnel Key Managerial Personnel Key Managerial Personnel 32 (b) Transactions during the year with Related Parties: Nature of Transaction Remuneration Paid Loans taken Purchase Sales (c) Outstandings Payables Receivables Loans Associate Key Managerial Personnel

35 NOTE: 33. Sr. No. 1. I PARTICULARS BUSINESS SEGMENT Segment Revenue External sales Inter- Segment Sales Less:Inter- Segment Sales Total Revenue DISCLOURE PURSUANT TO ACCOUNTING STANDARD-17 "SEGMENT REPORTING": Rubber Textile Rubber Textile Consolidated Products Products Products Products (768463) (768463) ( ) Amount in Consolidated ( ) Results Segment results before Interest Interest Unallocable Expenses Other Income Unallocable Income Profit after Interest Extraordinary Items Current Tax (including WT) Deferred Tax Net Profit after Tax Other Information Segment Assets Unallocable Assets Segment Liabilities Unallocable Liabilities Capital Expenditure Including CWIP Depreciation Unallocable Depreciation II GEOGRAPHICAL SEGMENT Revenue India Outside India NOTE: RECONCILLIATION OF OPENING AND CLOSING BALANCES OF DEFINED BENEFIT OBLIGATION Defined Benefit obligation at beginning of year Current Service Cost Interest Cost Acturial (gain)/loss Benefits paid Defined Benefit obligation at year end Gratuity (Non-Funded) (70461) (65847) (441413)

36 2. RECONCILLIATION OF OPENING AND CLOSING BALANCES OF FAIR VALUE OF PLAN ASSETS Gratuity (Non-Funded) Fair value of Plan assets at beginning of year Expected return on plan assets Acturial gain/loss Employer contribution Benefits paid Fair value of Plan assets at year end Actual return on plan assets 3. RECONCILLIATION OF FAIR VALUE OF ASSETS AND OBLIGATIONS Fair value of Plan assets Presnt value of obligation Amount recognised in Balance Sheet Gratuity (Non-Funded) As at As at EXPENSES RECOGNISEF DURING THE YEAR Gratuity (Non-Funded) As at As at Current Service Cost Interest Cost Expected return on Plan assets Acturial (gain)/loss NET COST (65847) INVESTMENT DETAILS Gratuity (Non-Funded) As at As at GOI Securities Public Securities State Government Securities Insurance Policies Others (including bank balances) 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 6. ACTURIAL ASSUMPTIONS Mortality Table(LIC) Attrition Rate Discount rate (per annum) Expected rate of return on Plan Assets (per annum) Rate of escalation in salary (Per Annum) Gratuity (Non-Funded) % 8.00% 0.00% 5.00% 2.00% 8.50% 0.00% 5.00% NOTE: 35. NOTE: 36. NOTE: 37. NOTE: 38. The power cost is net of value of captively consumed units of wind mill. The Disclosures as required to be made relating to Micro, Small and Medium Enterprise under the Micro,Small and Medium Enterprises Development Act, 2006 (MSME) are not furnished in view of the non avaibility of the relevant information with the company from all such enterprises. However, in the considered view of the management and as relied upon by the auditors, impact of interest, if any that may be payable in accordance with the provisions of this Act is not expected to be material. The Company has export obligation to the extent of Crores on account of concessional rate of custom duty availed under EPCG license Scheme on import of capital goods. Based on review carried out as on , no impairment loss is required to be provided for as per Accounting Standard 28 on "Impairment of Assets". 34

37 NOTE: 39. NOTE: 40. In the opinion of the management the balances of sundry debtors, loans and advances have approximately the same realisable value as shown in the accounts. Significant accounting policies and practices adopted by the company are disclosed in the statement annexed to these financial statements as Annexure-1. Signatures to Notes 1 to 40 As per our report of even date For BHANWAR JAIN & CO. Chartered Accountants. Firm Registration No. : W JEETMAL B. PAREKH Chairman RAHUL J. PAREKH Managing Director ANAND J. PAREKH Jt. Managing Director ( B. M. JAIN ) Partner. Membership No. : AHMEDABAD: 30th May, AHMEDABAD: 30th May, NIKHIL K. PARIKH Director JAPAN N. SHAH Company Secretary ANNEXURE -1. SIGNIFICANT ACCOUNTING POLICIES AND PRACTICES Basis of Accounting : The financial statements are prepared in accordance with relevant accounting standards under the historical cost convention on accrual basis and as a going concern with revenues considered and expenses accounted for wherever possible on their accrual. The accounting policies are consistent with those used in the previous year. Use of Estimates: The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of financial statements and the results of operations during the reporting year. Although these estimates are based on management's best knowledge of current events and actions, actual result could differ from these estimates. Fixed Assets: (a) Fixed assets are stated at cost less accumulated depreciation and impairment losses, if any. The cost comprises the purchase price and any attributable cost of bringing assets to its working condition for its intended use. Borrowing cost relating to acquisition of fixed assets which takes substantial period of time to get ready for its intended use are also included to the extent they relate to the period till such assets are ready to be put to use. (b) Expenditure during the construction period (including financing cost relating to borrowed funds for construction or acquisition of fixed assets) incurred on projects under implementation are treated as pre-operative Expenses, pending allocation to the assets and are included under "Capital Work in Progress". These expenses are apportioned to fixed assets on commencement of commercial production Depreciation : Depreciation on fixed assets is provided on the basis of straight line method at the rates prescribed in Schedule-XIV of the Companies Act, 1956 on pro rata basis. The management of the Company is of the view that these depreciation rates fairly represent the useful life of assets. The leasehold land is amortized on straighline basis over the initial period of lease. Inventories : Raw materials, finished goods, semi finished goods, trading goods and stores and spares are stated at cost or net realisable value whichever is lower. Fent, rags and rejections are stated at net realisable value. The cost of inventories is computed on FIFO basis. Investments: Investments of the Company are long-term. The same are valued at the cost of acquisition. Decline in the value of permanent nature is provided as per accounting standard AS 13. Dividend of investments is accounted for as and when received. Revenue Recognition : Revenue is recoginised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. The Company recognise sales of goods on transfering property of undelying goods to customers. Sales include all charges and duties collected. Export benefits in respect of exports made have been accounted on accrual basis. 35

38 8. 9. Excise/Custom Duty : The liability for excise and custom duty in respect of material lying in the factory/bonded premises is accounted for as and when they are cleared/debonded. Foreign Currency Transactions : (a) Transactions denominated in foreign currencies are recorded at the exchange rate prevailing on the date of of the transaction or that approximates the actual rate at the date of the transaction (b) Monetary items denominated in foreign currencies at the year end are restated at year end rates. In case of items which are covered by forward exchange contracts, the difference between the year end rate and rate on the date of the contract is recognised as exchange difference and the premium paid on forward contracts is recognised over the life of the contract. (c) Non Monetary foreign currency items are carried at cost. (d) Any income or expense on account of exchange difference either on settlement or on translation is recognised in Profit & Loss except in case of long term liabilities, where they relate to acquisition of fixed assets, in which case they are adjusted to the carrying cost of such assets. Borrowing Costs: Borrowing costs directly attributable to the acquisition or construction of fixed assets are capitalised as part of the cost of the assets upto the date the asset is put to use. Other borrowing costs are charged to the Profit & Loss Account in the year in which they are incurred. Research and Development: Revenue expendutire, including overheads on Research and Development is charged out as an expense through the natural heads of account in the year in which incurred. Expenditure which results in the dreation of capital assets is taken as Fixed Assets and depreciation is provided on such assets as are depreciable. Government Grants: Grants received against specific fixed assets are adjusted to the cost of the assets and those in the nature of promoter's contribution are credited to Capital Reserve. Revenue Grants are recognised in the Profit and Loss Account in accordance with the related scheme and in the period in which these are accured. Retirement Benefits: The liability for gratuity has been provided on the basis of actuarial valuation carried out by an independent actuary as at Balance Sheet date. In respect of Provident Fund contributions paid regularly to the government and is charged to revenue. The provision for leave encashment is made for accumulated leaves that employees can encash in future. Taxes on Income: Provision for current tax is made based on the tax liability computed after considering tax allowances and deductions. Deferred tax resulting from timing difference between taxable incomeand accounting income is accounted for using the tax rates and laws that have been enacted or substantively enacted as on the balance sheet date. The deferred tax asset is recognised and carried forward only to the extent that there is a reasonable certainty that the asset will be realised in future. Earning Per Share: The earning considered in ascertaining the company's earning per share comprises the net profit after tax (and includes the post tax effect of any extraordinary items). The number of shares used in computing basic earning per share is the weighted average number of shares outstanding during the year. Impairment of Assets: The carrying amount of assets is reviewed at each balance sheet date to determine whether there is any indication of impairment. If any such indication exist, the recoverable amount of the assets is estimated. An impairment loss is recognised whenever the carrying amount of an asset or its cash generating units exceeds its recoverable amount. An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount and recognised in compliance with AS-28. Provisions, Contingent Liabilities and Contingent Assets: Provisions involving substantial degree of estimation in measurement are recognised when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Liabilities are not recognised but are disclosed in the notes. Contingent assets are neither recognised nor disclosed in the financial statements. Inter Divisional Transactions: Inter divisional transactions are eliminated as contra items. Any unrealised profits on unsold stocks on account of inter divisional transactions is eliminated while valuing the inventoy. 36

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